The Restatement rule refers to the Restatement (Second) of Torts, which provides guidance on negligence and professional duties. In this scenario, if the state law governing the lawsuit between Neighborhood Sales and Karla follows the Restatement rule, it would typically assess whether Karla breached her duty of care as an accountant.
Under the Restatement rule, a professional like Karla owes a duty of care to the parties that she knows will rely on her work, or to those whom she should reasonably foresee as relying on her work, such as prospective buyers of the company (Neighborhood Sales). If Karla prepared the financial statements and other documents with the intent or knowledge that they would be used by prospective buyers like Neighborhood Sales to evaluate the company, she could be held responsible for any errors that result in financial loss.
Neighborhood Sales might argue that Karla breached her duty of care by providing inaccurate financial statements that led to a financial loss when they purchased Worldwide Enterprises. If the court finds that Karla’s errors directly contributed to Neighborhood Sales overpaying for Worldwide, they may hold her accountable for the damages resulting from the inaccurate financial information she provided.